California-based genetic testing company 23andMe has filed for Chapter 11 bankruptcy protection and announced plans to sell its assets following prolonged financial difficulties. The company, which has provided direct-to-consumer DNA testing since 2007 and sold over 15 million testing kits, is now seeking buyers through a competitive auction process.

Despite financial troubles, 23andMe has assured customers that their genetic data will remain protected. “We are committed to continuing to safeguard customer data and being transparent about the management of user data going forward,” said Mark Jensen, Chair of the Board of Directors.

CEO and co-founder Anne Wojcicki has resigned from her position to participate in the sales process as an “independent bidder” after her initial takeover bid was rejected.

## Privacy Concerns Intensify

Privacy experts have expressed significant concerns that the sale could potentially compromise the genetic information of millions of customers. In response, California’s Attorney General issued a consumer alert advising 23andMe users to request deletion of their data and test samples while revoking research permissions.

The UK’s Information Commissioner’s Office also weighed in, emphasizing that genetic information is highly sensitive personal data and that 23andMe remains obligated to protect customer information under GDPR regulations regardless of the bankruptcy proceedings.

## Recent Legal Troubles

The bankruptcy filing follows a series of setbacks for the company. In September 2024, 23andMe agreed to pay $30 million to settle a lawsuit stemming from a 2023 data breach that exposed information from 6.4 million customers. The company later confirmed that attackers had stolen health reports and raw genotype data during a five-month credential-stuffing attack.

The data breach triggered multiple class-action lawsuits, prompting 23andMe to amend its Terms of Use in November 2023—a move widely criticized as an attempt to limit customers’ ability to sue the company.